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CBN Advises Banks, Others on Risk Management

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  • CBN Advises Banks, Others on Risk Management

The Central Bank of Nigeria has advised risk managers in the financial services industry and other sectors to chart a new course for the economy amid the emerging economic realities in the country.

The Governor, CBN, Godwin Emefiele, stated this at the induction of newly certified risk managers in Lagos.

According to him, the economic diversification efforts of the Federal Government must be sustained and other sectors of the economy must be developed to generate substantial revenue for the government.

The CBN governor spoke on the theme, “The challenges of modern-day risk management.’’

Emefiele, who was represented by the Director, Risk Management, CBN and Chairman, Board of Trustees, Risk Managers Association of Nigeria, Folakemi Fatogbe, said, “When we look at the medium and long-term outlook for oil prices, and see that 70 per cent of our oil goes toward filling of cars; and we see what is happening in a number of jurisdictions pictured by the likes of China, the Scandinavian countries, United Kingdom, France and their plan for electric cars, we know what our future is as risk managers where most of our lending is to the oil sector. We know that there is a challenge. That’s why at the Central Bank of Nigeria, we are trying our best to aid economic growth.”

He added, “But for you as risk managers, it means that our dependence on oil must be to diversify from oil, it must reflect in what we do so that you can familiarise with other sectors of the economy that can enable us diversify and achieve sustainable economic growth. I think it is very important.”

The President/Chairman of Council, Chartered Institute of Bankers of Nigeria, Prof. Segun Ajibola, noted that risk managers had central role to play in the economy, urging them to be role models to “budding risk professionals.”

He charged the inductees to uphold the high level of ethical and professional conducts, if they would not betray the trust reposed on them as risk professional.

The Group Managing Director, First Bank of Nigeria Limited, Dr. Kazeem Adeduntan, noted that enterprise risk management was a must for any financial institution in a complex and digitised world.

According to him, weak enterprise risk management framework and practices have adverse effects on institutions.

He identified organisational culture as a critical success factor for an effective risk management system.

RIMAN President, Jude Monye, said CRM was superior to the Financial Risk Manager certificate due to its local content.

As a result, he appealed to chief risk officers in various sectors of the economy to embrace the professional examination because of the critical roles they play in the economy.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

CBN Directs Banks to go After COVID-19 Financial Criminals

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Godwin Emefile

Central Bank Asks Banks to Stay Abreast Frauds and Rising COVID-19 Financial Crimes

The Central Bank of Nigeria has directed all financial institutions in Nigeria to update alert protocols in their Anti-Money Laundering/Combating the Financing of Terrorism monitoring tools, in accordance with emerging trends of rising COVID-19 related financial crimes.

In a circular titled, ‘Administrative letters to all banks and other financial institutions’ issued on Monday and signed by J.M. Gana, the Director, Financial Policy and Regulation Department, the apex bank said changes in business activities and financial transactions due to the shift caused by COVID-19 pandemic have led to the surge in financial crimes globally.

Therefore, it said financial institutions must now adapt quickly and keep abreast of the new emerging financial risks and other developments to arrest this new and emerging ML/TF.

According to the circular, this includes strategic investment in data mining and artificial intelligence software to monitor financial transactions effectively and report as quickly as possible.

The central bank said the Nigerian Financial Intelligence Unit, the central repository of suspicious transactions and other financial information, had released a comprehensive report on STRs and others.

It stated that the NFIU had identified cybercrimes, frauds, counterfeiting and substandard goods, diversion of public funds and misuse of non-government organisations funds as some of the ongoing crimes that banks across the nation need to stay abreast and report.

Other suspicious transactions and red flags identified in the report were some e-commerce companies with little or zero history or internet presence suddenly receiving multiple payments from unrelated third parties.

Similarly, it said individuals with zero or little history of financial transactions receiving multiple payments from unrelated third parties. It also noted that customers who suddenly start delaying in the supply or purchases of medical supplies and payment of goods linked to known brands, yet the beneficiary is an individual, not a corporate company should be flagged.

The measures, the apex bank said were necessary due to the rising numbers of unusual transactions from banks’ customers and unscrupulous individuals.

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Union Bank Secures US$40 Million Facility from IFC Global Trade Finance

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Union Bank Secures US$40 Million Facility from IFC Global Trade Finance

Union Bank of Nigeria Plc said it has secured a US$40,000,000 finance guarantee facility from the IFC, a member of the World Bank Group.

In a note to the Nigerian Stock Exchange, the lender said the facility would help boost access to finance for local businesses and enable increased international trade for Nigeria.

It explained that the facility “will support Union Bank to establish working partnerships with nearly 300 major international banks within the GTFP network, thereby broadening access to finance and reducing cash collateral requirements for Nigerian businesses.

“The facility will enable the continued flow of trade credit into the Nigerian market at a time when imports are critical, and the country’s exports can generate much-needed foreign exchange.

Under the IFC’s Global Trade Finance Program (GTFP) terms of the agreement, GTFP offers benefiting banks partial or full guarantees covering payment risk on Union Bank’s trade-related transactions.

Accordingly, these guarantees are transaction-specific and may vary depending on underlying instruments like letters of credit, trade-related promissory notes, guarantees, bonds, and advance payment guarantees.”

Emeka Emuwa, Chief Executive Officer of Union Bank, said, “Union Bank is pleased to join the IFC’s Global Trade Finance Program. This is a significant achievement as we continue to expand our trade financing offerings to our
customers. Even in these peculiar times, we remain focused on contributing to economic growth by developing tailored solutions that help our customers harness the teeming opportunities that still exist in the Nigerian market.

Eme Essien Lore, IFC’s Country Manager for Nigeria, said, “Keeping trade moving is essential to growth and job creation, especially during the challenging economic times we are living through today. We welcome Union Bank to IFC’s Global Trade Finance Program and value a partnership that will make a positive impact on Nigeria’s economy.

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Apapa Customs Command Generate N367.6bn in Nine Months

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Nigeria Customs Service

Customs Command Apapa Realises N367.6bn Between January and September

The Nigeria Customs Service, Apapa Command, said it generated N367.6 billion in the nine-month ended September 2020.

Mohammed Abba-Kura, the Customs Area Controller, disclosed this while speaking with newsmen in Lagos.

He said a total of 328 containers of goods worth N19.5 billion were seized during the period. This, he said represents an increase of 37 containers when compared to the same period of 2019.

Speaking further, Abba-Kura said the N367.6 billion realised in the first nine months of the year, represented a 17 percent or N54.1 billion increase from N313.5 billion it collected during the same period of 2019.

The Apapa Command generated N14.3 billion as revenue in the third quarter from customers’ duty and other charges.

He said “The difference recorded was made possible as a result of resilience of officers in ensuring that importers and agents are made to do proper declarations, adhere strictly to import/export guidelines in tandem with extant laws.”

Commenting on the seizures, Abba-Kura said, “These items were seized mainly because of various forms of infractions which range from false declarations, non-adherence to import/export guidelines and failure to comply with other extant regulations as enshrined in the Customs and Excise Management Act.

“In the area of export trade, the period under review recorded exportation of goods worth N26,273,706,822 exported from the country.”

“These exported goods include mineral resources, steel bars, agricultural products among others with a total tonnage of 378,447 million tonnes free on board value of $85.8m. Similarly, the volume of export from January to September 2020 stood at N78.6bn with FOB $257,003,965.”

He added that the compliance level rose to about 60 percent during the period, highlighting the reason for the surge in the number of seizures made.

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